Market demand is given as Q_D= 120 - 2P.Market supply is given as Q_S= P + 30.Which legally imposed price would constitute a binding price floor

Name: Market demand is given as Q D = 120 - 2P.Market supply is given as Q S = P + 30.Which legally imposed price would constitute a binding price floor
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Question

Quizplus · Accepted Answer

A binding price floor is set above the equilibrium price. The equilibrium price is found where QD = QS, which is at P = 30. Therefore, a price floor of $45 is above the equilibrium price and would be binding.

Market Demand Is Given as QD = 120 - 2P

Market Demand Is Given as Q_D= 120 - 2P